Protected Areas’ Deforestation Spillovers and Two Critical Underlying Mechanisms:
An Empirical Exploration for the Brazilian Amazon

To date, the creation of protected areas (PAs) has been the dominant policy in the
efforts to protect forests. Yet there is still somewhat limited rigorous evidence
about the impacts of PAs on rates of deforestation. Further, most of the existing
evidence concerns the impacts of protection within the boundaries of PAs. Much of
that existing evidence does not use the characteristics of the protected lands when
generating the baselines to which outcomes on protected lands are compared in order
to infer the PAs' impacts. Yet even when impact within a PA has been estimated as
rigorously as possible, since the total impact of protection involves impact not only
inside the PA but also outside the PA even the best possible estimates of impacts
within PAs could mis-state total PA impacts. Overstatements occur if there is "leakage"
from PAs, i.e., spillovers of activities to forests outside PAs, so deforestation
outside is higher than it would have been without the PAs.

My dissertation starts with a reduced form examination of net local spillovers. We
follow this with an evaluation of two mechanisms through which PAs could affect forest
nearby. In particular we explore two novel angles by considering both migration choices
and road building decisions. PA creation could affect the development equilibrium
by shifting private and public expectations to lower migration and road building where
the PA is established, beyond the PA's boundaries. My dissertation explores implications
of such thinking and provides novel empirical evidence for the Brazilian Legal Amazon.

Chapter 1 estimates deforestation spillovers around Brazilian Amazon PAs. Given PA
location bias towards regions with low deforestation pressure, we use matching methods
to control for observable land characteristics that may confound PAs' impacts. Specifically,
we compare 2000-2004 and 2004-2008 deforestation on the land nearby to PAs with clearing
of untreated forests similar in key deforestation determinants. We find that some
PAs reduce deforestation rates nearby and, consistent with deforestation impacts inside
PAs, those local spillovers vary across the landscape. Reductions are significant
near roads and cities − not expected if the result is due to insufficient empirical
controls but unsurprising if real impacts are arising due to PAs − and around an understandable
subset of PAs. This result contrast sharply with most existing analyses of PAs' spillovers
where, if anything, 'leakage' (higher nearby clearing) is discussed and observed.
Yet we affirm a more general point that local spillovers depend on local development
dynamics.

Chapter 2 examines one mechanism for the prior result that PAs lowered rates of deforestation
nearby. Given migration's importance throughout the history of this forest frontier,
we ask whether dissuading migration could be a mechanism for protection's local conservation
spillovers. Examining individual migration decisions among the Amazon municipalities,
we find that Federal PAs − previously seen to reduce rates of deforestation near PAs
− seem to encourage outmigration from and discourage migration to PA areas.

Chapter 3 examines another mechanism for the result in my Chapter 1. We consider a
recent expansion of the unofficial roads networks in the Brazilian Amazon to provide
initial evidence concerning whether PAs may affect such investments in development.
Specifically, controlling for prior roads − both official and unofficial − we test
whether the growth in unofficial roads between 2008 and 2010 is reduced by establishments
of PAs. Thus, we examine road growth as another potential mechanism for forest spillovers
from PAs. Controlling for relevant observable factors, and using both matching and
OLS, we find that having a large fraction of municipal area in PAs − in particular
Federal PAs − reduces the growth of unofficial roads. Such impacts can significantly
influence regional development patterns.